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Mr Carney said "money was memory for a country and its people" and for that reason it was right that historical figures such as Churchill appeared on notes.

Sir Winston's grandson, Conservative MP Sir Nicholas Soames, said the note was "a wonderful tribute" and thought the man himself would have liked it.

Speaking at the launch in the palace's Marlborough Room, he said: "I think he would regard it as an amazing tribute.

"When he was a young man I think he used to get through a fair bit of the stuff himself, so I think he probably would have thought it unlikely he would ever feature on a bank note himself.

"I think it's a wonderful tribute and it's a living tribute."

The note itself features Sir Winston's glowering visage in a famous portrait captured in Ottawa by Yousuf Karsh after the photographer is said to have taken his cigar from him.

New £5 banknotes will be issued in September (Photo: Bank of England/PA)

The decision to use an image of the man voted "the greatest ever Briton" in a 2002 BBC poll went down well with the public in a showcase of the new note held immediately following the Governor's speech.

The fivers will save the bank about £100million over 10 years.

Some 44 million of the notes will be released in September, followed by plastic versions of other notes.

A plastic £10 note featuring author Jane Austen will be released next summer and a £20 note with artist JMW Turner by 2020.

Victoria Cleland is impressed with the new £5 notes (Photo: Bank of England/PA)

Victoria Cleland, the Bank’s chief cashier, said: “They are more modern and I think they’re beautiful.”

She added: “Yes, you can put them through washing machines. However, we’re not encouraging people to do that.”

The Bank of England, which dealt with 240,000 counterfeit notes last year, hopes the new notes will be harder to copy.

The announcement by the Bank of England in 2013 that Fry was being replaced caused an outcry as it could have meant that, apart from the Queen, there would be no female faces on the UK's notes.

New fivers are printed on polymer (Photo: Bank of England/PA)

Thousands of people signed a petition in protest at the move, and it was subsequently announced that novelist Jane Austen would be the face of the new £10 note from 2017.

Like the new fiver, the new £10 and £20 notes will also be printed on polymer.

In April, the Bank announced that artist JMW Turner will appear on the next £20 banknote, due to be issued by 2020.

Australia introduced the world's first plastic bank notes in 1988 and more than 30 countries have since followed suit.